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Villains, Thieves and Scoundrels

Oct 31, 2009

If you remember Rocky and Bullwinkle, then you remember Boris Badenov. Diminutive, palm-rubbing Boris, card-carrying member of Local 12 of the "Villains, Thieves and Scoundrels Union," and self-proclaimed "world's greatest no-goodnik."

When Bernie Madoff oozed onto America's front pages, I hadn’t thought of Boris in years. But there he was, a cartoon bad guy come to life. Bernie and his wife Ruth (a.k.a. Natasha Fatale) presented themselves as just another couple trying to get ahead--albeit with plenty of smirking and palm-rubbing while sipping Cristal aboard yachts.

These two were a MAD Magazine parody straight out of the post-Nixon era of my youth, and would have been subject for nothing more than snarky sniggering, were the impact of their real-world misdeeds not so devastating. Devastating not just in the sense of dollars stolen from individuals, foundations, municipalities and institutions, but in terms of what such misbegotten success revealed about the role our Fearless Leaders (in the persons of Hank Paulson and Alan Greenspan) had in enabling it.

Willful blindness in support of the belief in one's own ineluctable excellence--despite mounting, unexamined, evidence to the contrary--is a form of hubris. Such hubris is subject to irrational exuberance (and uncontrollable contagion) when excellence is defined solely as profit and the money risked to make the profit isn't yours.

Turns out Paulson and Greenspan had been cheerfully blind for more than a decade--deaf and dumb as well. But they never lost their taste for profit, regardless how improbable or implausible or just plain impossible the numbers on the books. They donned rose-colored glasses and enjoyed the champagne. Instead of auditing Wall Street, they accommodated Wall Street.

In the absence of any Rocky or Bullwinkle to remind them, our flesh-and-blood Fearless Leaders forgot they weren't supposed to support the Local 12. They were supposed to shut it down.

Instead, with the exception of a scant handful of Bernie Madoffs, most members received a Get Out of Jail Free card--and a bonus to boot. Thus the directive to the Union from a new crop of Fearless Leaders is not that bundling, selling and placing bets on esoteric financial instruments with negative market value is a criminally destructive act that will not be tolerated, but quite the opposite.

Listen fellas, the Fearless Leaders whisper, if it turns a short-term profit, go for it! Remember, the Union is too big to fail. We've got your back the next time you get caught.

And "We, The People," the bankrupt, unemployed, bereft and foreclosed? Do the Fearless Leaders have our backs? I don't think so.

This most frightening message of the past couple years casts a Mr. Big-worthy shadow: Unless you're a member of "Villains, Thieves and Scoundrels," you're on your own.

Unfortunately, Local 12 doesn't only exist on Wall Street.

The single most appalling realization of my recent engagement with Industrial Wind Power is the great extent to which our Fearless Leaders, from the U.S. Treasury Department to the state public service commission and the county board of supervisors, are devoted to the generation of short-term profits for the very few. What I've found increasingly shocking is the extent to which the costs of these profits are simply passed-on to "The People," but never valued as a "cost of doing business."

Much like the lost home value, lost retiree savings, and lost jobs wrought by Wall Street profit-seekers, the collateral damage of "green energy" profiteering is borne entirely by "The People." This collateral damage--the flesh-and-blood cultural, economic and environmental costs of Big Wind--is not quantified by our Fearless Leaders.

Never quantified nor reimbursed, such costs amount to a Silent Subsidy, paid by "The People" yet never accounted for on the books, that makes an otherwise unsustainable project look like a good investment.

Sound familiar?

Wishful thinking does not a good investment make. No more in the case of "green energy" than in the case of collateralized debt obligations packaged around sub-prime loans.

Yet today's Fearless Leaders seem as immune as yesterday's in learning this lesson. Deregulation (otherwise known as "Don't Ask, Don't Tell--Wall Street Style") got us into our present financial crisis.

The American Reinvestment and Recovery Act of 2009 exempts wind utilities that accept government grants from complying with both the National Environmental Policy Act and the Davis-Bacon Act of 1931, which requires the payment of prevailing wages on public works projects. Any industry built on the sweeping exemption from environmental and labor law may be described as many things. "Green" is not among them.

I remember an intrepid flying squirrel and good-natured moose who simply wouldn't stand for such nonsense.

Rocky and Bullwinkle, where are you?